Originally Posted by Eclectus

Contracts expire. Exclusivity relationships may be subject to legal challenge under various antitrust/price-fixing theories if it can be shown that American consumers are paying higher prices than other countries' consumers either because Manufacturer A is simultaneously charging a premium price to USA distributor, but less to Asia distributor, then USA distributor charging LBSs more than Asia distributor charging its retailling channels, and so on down to respective end-consumers, or manufacturer charges same, but USA distributor charges higher mark-up solely because it can, being the exclusive agent for the manufacturer.

To wit if somebody credible, i.e. LBS coop comprised of experienced product sellers, who merely propose doing what they are already doing, moving product to manufacturer's benefit, and getting prices offered to the distributor(s), with an intent to save USA consumers money or even to capture sales now grabbed by offshore and uncontrolled domestic retailers by offering same prices to consumers that current distribution scheme precludes, they have a very good shot at prevailing. This is particularly meritorious because the coop can show that it wants to provide product-service to customers that the online dealers can't and won't, for example periodic inspections and adjustments, timely repairs, faster and cheaper returns for defective products, etc. The current scheme is forcing LBS closures, depriving consumers of these services.

In fact if the coop made this argument to manufacturers, and they turned a deaf ear, it wouldn't score the manufacturers any credibility or sympathy points in a court of law.

Short of this, the coop can alternatively start by buying products from the distributors, but en masse, and demand high-volume most-favored-customer discounts enjoyed by current high-volume customers. There is no way the distributor could say no without getting into legal quicksand. After 1000s of LBSs get on board, then they can move to deal directly with the manufacturer, under threat of commissioning another manufacturer to make alternative products, with a major hit to the uncooperative manufacturer, or the threat of exclusively buying another manufacturers already-existing competing products (and encouraging it to add new competing products), and dumping the uncooperative manufacturer's line.

Other avenues include buying-out some distributorships as an alternative to fighting them, if reasonable costs can be achieved, the benefit being a win-win situation for all parties.

The trick is to get a big mass of LBSs to join the initiative before confronting anyone, work as a savvy, unified-voice entity when dealing with suppliers, and sharing the operational and legal costs.